Get ready for a slowdown in world trade, a “pause” in business investment, job losses, and higher prices with inflation.
That was the message this week from Port of Los Angeles Gene Seroka as a new week began on Monday, April 7, with tariffs wreaking havoc on the stock market for the third straight day.
The Dow Jones Industrial Average fell 349 points, or 0.9%, the Nasdaq composite edged up by 0.1% and the S&P 500 slipped 0.2% on Monday, as beleaguered investors tried to figure out what Trump’s ultimate goal is for his trade war.
“Prices at the store are going to hit us right in the wallet,” Seroka said in a telephone interview, adding that while it’s not a surprise to see President Donald Trump “ratcheting up” the rhetoric and tariffs, the fallout is proving to be stunning.
Seroka said no possibility was dismissed by the trade sector when looking ahead as Trump was on the 2024 campaign trail.
But, he now adds, “This is much more than anything we’ve ever witnessed in our lifetime.”
The business sector, he suggested, “is going to hit ‘pause’” in light of all the unfolding uncertainty, including conflicting messages coming out of Washington.
Among impacts in the Los Angeles area, he said, will be the efforts to rebuild homes following the devastating fires in January.
The Port of Los Angeles Executive Director Gene Seroka, Wednesday Sept. 25, 2024. (Photo by Chuck Bennett, Contributing Photographer)“We’re going to need softwood lumber from Canada, appliances from Mexico, furniture from China, copper-aluminum-and steel to rebuild all these communities, and all those prices just skyrocketed last Wednesday,” Seroka said. “There are about 50,000 of us now without homes, living in short-term apartments with their families.”
America’s farmers are another concern, he said, with the U.S. consuming only about a third of what American farmers produce with the rest going overseas as exports.
Some 90% of trade moves on water, Seroka said, and many larger companies sent imports in early to beat the talked-about tariffs. As he said earlier this month, he anticipates a 10% drop or more in cargo that would hit by mid-year.
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The idea of shifting more production to the U.S., which is Trump’s goal, he added, has some flaws.
“It takes decades to put together industries,” he said, mentioning manufacturing of toys, clothing and other goods. “That would a decades-long approach.”
And it would still result Americans paying more goods they now receive from other countries for much cheaper.
For Americans, he said, “that’s more than just ‘medicine’ or (short-term) ‘pain.’
Many of the U.S. companies, he said, also have indicated they’d lean on automated factories so the jobs would not necessarily come as part of that transition.
“I believe in rules-based trade and in protecting American jobs,” he said.
The Associated Press contributed to this report
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